Michigan Gov. Rick Snyder signed a law Thursday that allows private faith-based adoption agencies holding state contracts to refuse prospective parents if it is against their religious beliefs. This means they can refuse adoption referrals for gay couples.

Snyder signed the bill in spite of criticisms that it is tantamount to imposing a government approved discrimination against LGBT couples.

"The state has made significant progress in finding more forever homes for Michigan kids in recent years and that wouldn't be possible without the public-private partnerships that facilitate the adoption process," the governor said.

According to Snyder, the new bill helps to systematize present adoption practices in the Michigan Department of Health and Services, which coordinates with private agencies to find homes for 13,000 children.

In recent years, adoption rates in Michigan have increased. In 2011, 70 percent of children in foster homes were adopted, and in 2014 the rate jumped to 85 percent.

Catholic Charities and Bethany Christian Services, which are responsible for finding homes for 25 to 30 percent of children in foster care, wrote letters to the governor stating that if the state's policy would change in the future and they would be mandated to refer children to same-sex couples against their beliefs, they would be forced to close their agencies.

In Illinois, the government's contracts with Catholic Charities were terminated in 2011 because the agency refused gay couples and referred them to other agencies. Many adoption agencies have closed in Illinois, and also in in Massachusetts, Washington, D.C. and California.

Rep. Andrea LaFontaine, who co-sponsored the bill, said that if adoption agencies will choose to close their doors instead of violating their religious beliefs, more children will suffer as adoption services lessen. There will also be "longer wait times and fewer child placements," The Christian Science Monitor reports.

The signing of the bill is being challenged by the American Civil Liberties Union of Michigan, saying private adoption agencies receive state money and should therefore be required to act in the children's best interest.

"Agencies have a legal obligation to ensure the best interests of the child are considered during placement. There is nothing about this shameful legislation that helps vulnerable kids find homes," ACLU of Michigan said in a statement published on their website.

Chad Griffin, president of Human Rights Campaign, the largest gay rights group in the U.S., accused the governor of having "utter disdain" for the well-being of the children.

"He cares only about empowering backwards discrimination," Griffin said. "This legislation keeps children in need out of the loving homes they deserve, and it sets this great state back decades," he said, the Washington Times reports.

However, Snyder commented that the law is not about discriminating against gays.

"This isn't about that," he said. "This is about making sure we get the largest number of kids in forever families," he clarified, according to The Christian Science Monitor.

Under the new law, adoption agencies that refuse couples that violate their religious beliefs are required to give a list of alternative agencies that the couple can go to.

Snyder emphasized that the state is focused on making sure that many children will be adopted to "as many loving families as possible regardless of their makeup."

The Michigan Catholic Conference expressed their gratitude to the governor, saying the new legislation will protect the rights of various faith-based agencies to operate "according to their conscience."